Your Friday fix for global fintech and payments news
Visa announces further extension of its work in the Middle East and North African payments market, as it facilitates the rise of the contactless transaction limit in the United Arab Emirates. In other news, COVID-19 drives further historic shifts in payments as a huge spike in bank app downloads is seen, with a recent report by the BBC that the coronavirus could see many ditch cash in the future.
Our weekly round-up brings you a dose of some of the biggest news announcements from the past seven days so you can keep an eye on all that’s shaping our world this week.
- Visa supports move in UAE to increase PIN-free contactless transaction limits
- Coronavirus causes spike in bank app downloads
- Coronavirus 'will hasten the decline of cash'
Visa announces that it supports the UAE Central Bank’s move to increase the Card Verification Method (CVM) limit for contactless transactions in UAE to AED 500 from AED 300. Visa is currently working with local bank partners and merchants to implement the new limit on Visa contactless cards within the United Arab Emirates.
Shahebaz Khan, General Manager of UAE at Visa, said: “The UAE Central Bank’s decision to increase PIN-free limits for contactless transactions in the country will allow larger everyday purchases to be made using this fast, easy and secure way to pay. It will even further support merchants and front-line staff working during these challenging times.” Visa has driven large changes in the Middle East and North African payments infrastructure working with local governments to increase contactless limits across the MENA region. Central banks in Saudi Arabia, Kuwait, Bahrain, and Egypt have further increased the limits on contactless transactions, extending the speed and convenience of contactless to larger purchases.
Over 6 million people have recently downloaded their primary bank’s app for the first time, according to a recent survey. FinTech firm Nucoro recently conducted a survey of 1,000 UK adults, finding that between 14 March and 14 April, around 200,000 people downloaded their bank’s mobile app for the first time, every day. This estimate suggests that 12% of the adult population in the UK made the digital leap in the past month.
Nikolai Hack, Chief Operating Officer at Nucoro, said that: “A combination of people going out less because of Coronavirus and their finances coming under growing pressure … has clearly led to a surge in people downloading their bank’s app for the first time and people generally using them more to keep a closer eye on their finances.” He continued that: “Once the Coronavirus crisis passes, for many people the way they interact with their banks will have changed permanently.” COVID-19 has undoubtedly left an indelible mark on the payments industry, but as the days go on, it seems that mark is greater than many of us could ever imagine. The mobile payments industry in this regard has grown to dizzying new heights – only time will tell how far the Coronavirus pandemic has ushered in a new age of banking.
BBC News have released a report warning of the potential decline of cash in the UK. The nationwide lockdown has led to a 60% fall in cash withdrawals from ATMs, although people are taking out bigger sums when they do withdraw money. In lieu of cash, there has been a sharp incline in the number of people making card-based payments, specifically through online shopping. Experts claim that the long-term future of cash could be at risk, and we could see a potential permanent shift to digital payments in the wake of the COVID-19 pandemic.
Following a survey from Link, the UK’s largest cash machine network, they found that 75% of people were using less cash, and 54% of those asked were avoiding cash – notably from fears of banknotes and coins being potential carriers of the virus. Most notably, however, was the revelation that 76% of the survey respondents expect to use cash less and move to alternative payment methods in the coming months. Natalie Ceeney, Chair of the Access to Cash Review, noted that the growing despondency towards cash could prove a “sticky habit” with many making significant lifestyle changes with regards to how they pay. Others disagree, Martin Smith, Head of Commercial Strategy at Pivotal, the Cash-in-Transit company, said that: “It will be hard to judge the true impact of Covid-19 until businesses have reopened. The pandemic has certainly not changed many of the key reasons why people use cash, including convenience and lack of access to bank accounts." The far-reaching ramifications of lockdown across the globe are yet to be seen, but from recent developments, one can only assume that cash’s days are numbered.